Economists say flooding in Alberta will cost Calgary’s economy billions of dollars and affect the Canadian economy as a whole.
Although the precise economic damage caused by the flooding is hard
to measure, economists say it will be widespread and long-lasting.
One estimate from BMO Capital Markets is that Canada's GDP will be reduced by $2 billion as a direct result of the floods.
Tom MacKinnon, an analyst with BMO Capital Markets, estimates that
direct losses from the flooding will be between $3 billion and $5
billion.
That is at least 10 times higher than the losses incurred
during the floods of 2005.
In Calgary, the floods will cut into retail sales, tourism and industries that service the energy industry.
Todd Hirsch, chief economist at Alberta Treasury Branch, says the
large oil and gas companies headquartered in Calgary are coping.
“Production itself is not being disrupted. No oil and gas comes
through downtown Calgary.
It would be far more disruptive for these
companies financially if it was a refinery or maybe one of their mining
operations went down in the flood,” said Hirsch.
However, three pipelines in the province have been damaged and rail shipments were disrupted for several days.
Hirsch says that he expects economic activity in Calgary to slow in
the short term, but that will be somewhat offset by a boost in spending
to rebuild the city’s infrastructure.
On Monday, Alberta Premier Alison Redford said it would take 10 years
to rebuild the flood-damaged areas of the city and the province. She
pledged an immediate $1 billion in aid toward emergency relief and
reconstruction.
Source: CBC...More...
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